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Hyundai to expand U.S. engine production

Hyundai's engine plant in Alabama builds four-cylinder units for use in cars and SUVs.

Hyundai Motor Co. will spend $173 million to expand its engine plant in Alabama to build more four-cylinder engines.

The expansion work is set to be complete this fall and production is set to begin in March 2012. It will enable the company to start building the Nu four-cylinder engine for the Hyundai Elantra small car built at the plant.

The expansion will also let Hyundai increase production of the Theta four-cylinder engine used in the Hyundai Sonata built at the Alabama plant, and the Hyundai Santa Fe and the Kia Sorrento SUVs built at a Kia assembly plant in Georgia.

The investment will create 214 jobs, according to the state. It will boost engine production at the plant by 300,000 units per year, said Deuk Lim, CEO of Hyundai Motor Manufacturing America.

The expansion comes amid rumors that Hyundai is considering building a second assembly plant in North America.

Hyundai CFO Lee Won-hee said in April that no formal plans are in place but that the company could consider building another U.S. production plant if the market continued to improve.